A new lawsuit by Keep Fort Ord Wild alleges the Fort Ord Reuse Authority and Michael Houlemard violated state law by hiring a consultant to write their reassessment plan who is already the project manager for Monterey Downs, the largest proposed development on the former Army base.

The city of Seaside hired EMC Planning Group in February to guide development of the equine-themed project, which would include 1,500 residences, two 200-room hotels, retail areas, an Olympic-sized aquatic center and a horse-racing track. Monterey Downs LLC, the developer, is paying the $192,000 contract.

Before it can become a reality, the project must conform with the Fort Ord Base Reuse Reassessment Plan, which will guide future land use on the base, among other things, and must be completed by Jan. 1, 2013.

In April, after prolonged discussions and recommendations by an interview panel for a different consulting firm, the FORA board hired EMC to write the reassessment plan. The contract, which Houlemard signed, eventually totaled $506,000.

The danger, Keep Fort Ord Wild alleges in its lawsuit, is that EMC is being paid "by two masters" to meet with itself to write the rules that will win approval for Monterey Downs. The cozy relationship, the suit states, is a violation of the Political Reform Act and conflict of interest laws.

The suit seeks an injunction against the arrangement, a finding regarding the rights and obligations of the parties, and attorneys fees.

Houlemard and FORA's in-house attorney Jerry Bowden were not in the office Thursday afternoon. Outside counsel Jon Giffen said he had not had time to read the lawsuit, which he received late in the afternoon, but said FORA would respond appropriately.

Speaking from an administrative point of view, Assistant Executive Officer Steve Endsley said his staff reviewed both of the consulting agencies that applied for the job, EMC and RBF/AECOM, and judged both qualified.

Despite concerns raised in writing and in public comment by Keep Fort Ord Wild spokesman Michael Salerno, according to the lawsuit, Bowden advised the board EMC had no conflicts with regard to accepting the reassessment job.

The lawsuit is just the latest shot across FORA's bow by the group of open-space and outdoor-recreation enthusiasts. It filed suit in March over public records it sought pertaining to FORA's use of a $100 million federal grant for munitions cleanup on the base.

Since then, FORA has released to the public thousands of pages it earlier denied it had or even existed, the new lawsuit states.

Waiting in the wings is a likely lawsuit over expense reimbursements to Houlemard, including reimbursement of his residential DSL service and nearly $300 for a moving violation and traffic school. A claim over those expenses was denied by the board.

Thursday's lawsuit is potentially more serious, as it threatens to delay work on the base-reuse reassessment, which must be completed by Jan. 1. It also comes at a time when the state Legislature is considering extending FORA's authority beyond its 2014 sunset.

Monterey Downs last month submitted an application to the city of Seaside that would require numerous amendments to the city's general plan, zoning and planning laws. Any amendments would have to be approved by FORA's Base Reuse Plan. Seaside is also seeking annexation of land for the project that was earlier allocated to the county.

EMC, which is guiding both processes, is required to have a representative onsite in FORA offices. At the same time, the company is writing documents on Seaside letterhead regarding Monterey Downs.

"The FORA consultant is writing rules, omitting other rules that may inhibit or prevent the Monterey Downs project, and setting up a regulatory plan that decides what is permitted ... and what is prohibited," the lawsuit states. "The FORA consultant is writing the script for the same controversial project which consultant is managing in (its) role as project manager."

The conflict, the suit states, is demonstrated by comments Seaside made to FORA in an Aug. 2 letter complaining that the base reuse plan has not promoted economic development in the city. The letter "strongly advocated" that the reassessment give greater emphasis to reaffirm Seaside's future development.

It also "pleads for a bigger piece" of FORA's money and water allocations to accommodate development, goals that would likely be in conflict with other jurisdictions.

Unlike the public, the lawsuit states, EMC has complete access to data and work products — paid for by tax dollars that support FORA — for purposes including research for Monterey Downs or other private interests.